Advanced Services Transformation Roadmap
Mapping your servitization journey
Manufacturers increasingly see services as a core component of their competitive strategy. Of particular interest are ‘advanced’ services, such as outcome and availability contracts, that can deliver longer term relationships with regular cash-flow from customers.
But transforming a product-focused organisation to deliver services effectively is fraught with challenges.
Our Roadmap is the result of an in-depth investigation into these challenges, and how these have been overcome by manufacturers who are successfully competing through advanced services. It is a tool for executives to prepare for service transformation and helps to navigate and overcome the obstacles on the journey to servitization.
Roadmap: our findings
Our research indicates that manufacturing companies go through four stages in their transformation: Exploration, Engagement, Expansion and Exploitation. Each of the stages will produce multiple actions, iterations and interactions until there is sufficient evidence and consent to move to the following stage.
Exploration: Searching and finding out about competing through advanced services
Engagement: The idea that advanced services are a valuable way to compete gains popularity and acceptance
Expansion: There is an increase in the speed at which advanced services are innovated and implemented
Exploitation: Advanced services form the basis of competitive advantage
Methodology
The Roadmap is the result of an in-depth study. We wanted the Roadmap to be a relevant and easy-to-use tool for businesses. Therefore, designing and developing of the study was a collaborative exercise between researchers and industry practitioners. We used joint workshops to set the research questions, create interview schedules, as well as set parameters for selecting services leaders to be interviewed.
In-depth interviews were carried out with nineteen services leaders from across Europe and the USA. Key themes and responses to the practitioners’ questions were drawn from transcripts of these interviews. They were then compared and analysed against change management frameworks, which led to the development of a model that captures the principal forces at play and the four stages (and activities within these stages) that characterise the transformation process.